Should You Buy Haleon Stock

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Should You Buy Haleon Stock

Haleon: Should You Buy This FTSE 100 Stock?

Haleon (HLN) stock performance has been unimpressive so far this year. The stock price has only gained an upside of 3% over the past year.

Haleon was spun off from GSK back in July of 2022. Since then, the stock price has gone up by 19%. Meanwhile, the FTSE 100 has gained 48% during the same time.

Haleon Is Struggling With Growth

It's safe to say that Haleon stock has been an underperformer when compared with the overall market. One reason why this consumer healthcare company is struggling is the lack of growth.

Also, most of Haleon's products are very mature. This means they have already achieved most of the growth. Some of their top products are toothpaste (Sensodyne and Aquafresh) and pain relief products (Panadol).

In simple words, the growth potential for new products is often high as they have yet to capture the market. Meanwhile, mature products can't replicate that kind of high growth.

These brands from Haleon are also facing pressure from supermarkets' own-label products. These products from the supermarket are cheap and thus have affected Haleon's sales.

If you think about it, people would naturally go for cheaper products. After all, inflation is high, and the cost-of-living crisis is showing no signs of slowing down. Amidst all of this, it is normal for people to ditch product loyalty and go for the cheaper option.

The overall revenue in 2026 is forecasted at 11.3 billion. It's similar to the numbers from 2023. This alone shows that Haleon is lacking growth.

But one thing that Haleon has going for itself is its dividend yield. It is now sitting at 1.95%, which could attract the attention of dividend investors.

Also, the Haleon stock is trading at a forward P/E of only 17. This doesn't make it exactly cheap at all when compared with other healthcare stocks.

Considering everything, it is clear that now's not a good time to buy the Haleon stock. There are better opportunities in the FTSE 100 and the healthcare sector in particular.

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